2Q 2020 Financial Results Briefing...2Q 2020 Financial Results Briefing Time and Date: August 13,...
Transcript of 2Q 2020 Financial Results Briefing...2Q 2020 Financial Results Briefing Time and Date: August 13,...
2Q 2020 Financial Results BriefingTime and Date: August 13, 6:00–7:00 PM (Zoom accessible from 5:50 PM)
Speakers: Yusuke Umeda (CEO), Yusuke Inagaki (COO)
Taira Sakuma (Board Director), Daisuke Chiba (CFO)
For English audio and slides, please register via the following URL:
https://zoom.us/webinar/register/WN_rrh-bKLaQ2eRTOsQQPXt9Q* English audio to be provided by a professional interpreter.
For Japanese audio and slides, please register via the following URL:
https://zoom.us/webinar/register/WN_-CHFB2UXTFG8QX0SxTjUjA
Notes:
A service called "Sli.do" will be used for the Q&A session.
Sli.do can be accessed via a URL which will be shared by the organizers during the presentation.
Individual investors are also welcome to attend!
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2Q 2020 Financial Results 4
Our Services
Business Intelligence PlatformA business intelligence platform that provides financial institutions and corporations with the insights they need to analyze and formulate business strategies, including global company financials, industry reports, market data, and M&A deals.
B2B Service
5
Our Services
2Q 2020 Financial Results
B2B Marketing PlatformA B2B marketing platform that integrates Uzabase Group's company information database with each customer's internal data to identify prospects with a high probability of closing based on in-depth data analysis. It also provides support for implementing Account Based Marketing practices.
B2B Service
6
Our Services
2Q 2020 Financial Results
Startup Information PlatformA startup information platform that provides a one-stop source for general data, financing, investors, and business partners of startups, as well as original articles on related topics.
B2B Service
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Our Services
2Q 2020 Financial Results
Social Business Media (Japanese Market)A business news media for the Japanese market that provides users with economic and business news articles, along with comments from business professionals and experts. On top of news articles from over 100 worldwide media, NewsPicks' Editorial Team distributes its own original articles and video content.
B2C Service
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Our Services
2Q 2020 Financial Results
B2C Service
Business Media (Global Market)A business news media for the global market that provides global business news and insights for a new generation of business leaders around the world. Main content produced by Quartz includes Daily Briefs—email newsletters delivering news on global events every morning and Field Guides—in-depth reports on specific topics.
Highlights of Consolidated Results
Highlights for SPEEDA
Highlights for Other B2B Businesses
Highlights for NewsPicks
Highlights for Quartz
Appendix
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02
03
04
05
06
Index
Highlights of Consolidated Results* All financials presented in this section are consolidated cumulative totals for each fiscal year.
01
● Figures calculated based on paid-in amount. For more details, refer to the “Notice Regarding Issuance of New Shares by Offering to Overseas Investors” and “Notice Regarding the Determination of Issue Price” released on 9 July 2020.● LO refers to long-only investors; HF refers to hedge funds
Raised JPY 5 billion through stock offering for overseas investors. Aiming to reinforce the financial base towards future business expansion.
Highlights of Consolidated Results: Fundraising
11
Pre-Fundraising(End-June 2020)
21,083
Total Assets
7,983Cash
14,048
Total Liabilities
9,443
Interest-Bearing Liabilities
8,794
Goodwill
7,035
Total Net Assets
Post-Fundraising(+JPY 5 billion compared to
end-June 2020)
26,176
Total Assets
13,076Cash
14,048
Total Liabilities
9,443
Interest-Bearing Liabilities
8,794
Goodwill
12,128
Total Net Assets
Categories of Participating Investors
LO51%
HF49%
Unit: JPY MM
JPY 2,000 MMJPY 2,350 MM
Highlights of Consolidated Results: Purpose of Fundraising and Intended Use of Proceeds
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Strategic investment to be directed to SPEEDA and NewsPicks to drive the next stage of growth in each business.
Loan Repayment
Funds to be used to strengthen the financial foundation, securing the capacity for flexible investments. Will continue to aim for further business growth through M&As and business investments.
Investments towards the development and operation of the expert network service, as well as reinforcing sales and marketing efforts, including enhanced customer success.
With a goal to ensure continuous growth in paid subscription business, investment will be directed toward the development of large-scale product improvements, as well as marketing efforts to increase brand recognition.
2Q 2020 Financial Results
JPY 650 MM
Both net sales and
EBITDA recorded
favourable growth.
Paid subscriptions
grew substantially.
Advertising revenue
also expanding steadily.
Advertising revenue
significantly decreased.
Paid subscriptions saw
accelerated growth.
Net sales growth
decelerated.
Profitability achieved
for the full 1H.
(Other B2B Businesses)
Highlights of Consolidated Results: Performance Overview
132Q 2020 Financial Results
Highlights of Consolidated Results: Forecast vs Actual
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Net sales behind targets due to sluggish growth in advertising business, but EBITDA growth outpaced forecast, indicating steady progress towards achieving profitability for the full year.
● Full-Year Forecast refers to the figures announced on 12 February 2020.● All monetary amounts and percentages are rounded to the nearest whole. (Same applies for slides that follow)
6,354 15,000-16,000
Profitability
Net Sales
EBITDA
2020 Results
Full-Year Forecast Progress rate:
40%-42%
-104
Unit: JPY MM
Due to substantial contributions from NewsPicks, MRR for the entire group was up by JPY 68 MM QoQ. ARR also increased to JPY 9,524 MM.
Highlights of Consolidated Results: MRR
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Dec 2020Dec 2011 Dec 2012 Dec 2013 Dec 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019
MRR: JPY 793 MM
Ratio of Recurring Revenue
in 2Q: 68%
● One-off transactions such as initial costs and advertising sales are excluded.● ARR refers to Annual Recurring Revenue, calculated as MRR multiplied by 12 months.
Robust growth seen in domestic businesses despite COVID-19. Contraction of advertising business at Quartz led to a drop in net sales.
Highlights of Consolidated Results: Net Sales
16● Financials for MIMIR, acquired earlier this year, are included as part of SPEEDA since 2Q 2020.
1,6942,142 2,638
1,249
1,885
2,511
660
360124
3,068
5,665NewsPicks Quartz
SPEEDA
Other B2B
1,276
544
+12%
+32%
YoY Change
Excluding Quartz
1H 2018 1H 2019 1H 2020
6,354
● “Other B2B” is a total for FORCAS and INITIAL.● Internal transactions between segments are excluded.
Unit: JPY MM
468
-53
826
-1,433
-1,216
1,049324133
82
-122
11
-10
EBITDA significantly improved due to increase in profit for SPEEDA and reduced deficit for Quartz.
Highlights of Consolidated Results: EBITDA
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+26%
YoY ChangeNewsPicks
Quartz
SPEEDA
Other B2B
Consolidated EBITDA
● EBITDA = Operating Profit + Depreciation and Amortisation (including Goodwill Amortisation).
● All EBITDA figures shown are calculated according to the revised cost allocation system.
-528
-104
+424 MM
Excluding Quartz
Unit: JPY MM
1H 2018 1H 2019 1H 2020
Highlights for SPEEDA
02
MRR demonstrated steady growth.
Highlights for SPEEDA: MRR
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June 2020June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 June 2017 June 2018 June 2019
● MRR refers to Monthly Recurring Revenue and excludes all one-off transactions such as initial costs.● MRR figure includes both the domestic and the overseas businesses.
435
2236
5586
122
174
228
296
373
・
・・
・
・
・
・
・
・
・Unit: JPY MM
Net sales maintaining a growth rate of over 20% even amid the COVID-19 pandemic.
Highlights for SPEEDA: Net Sales
20● Internal transactions between segments are included.● Financials for MIMIR, acquired earlier this year, are included as part of SPEEDA since 2Q 2020.
1,694
2,148
2,644
+23%YoY Change
Unit: JPY MM
1H 2018 1H 2019 1H 2020
High earnings maintained even after MIMIR acquisition.Planning to reinforce growth investments towards next year from 3Q onward.
Highlights for SPEEDA: EBITDA
21● All EBITDA figures shown are calculated according to the revised cost allocation system.● Financials for MIMIR, acquired earlier this year, are included as part of SPEEDA since 2Q 2020.
+27%YoY ChangeEBITDA Margin
EBITDA 826
1,049
468
27.7%
38.4%39.7%
Unit: JPY MM
1H 2018 1H 2019 1H 2020
Highlights for SPEEDA: Recent News
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Following the acquisition of MIMIR, a capital alliance agreement was also signed with US company GlobalWonks, Inc. Going forward, will aim to provide global expert opinions on SPEEDA.
2Q 2020 Financial Results
Company and industry information platform covering over 8 million companies from 200
countries
Network of around 7,000 experts in Japan
Network of around 10,000 experts in 180 countries worldwide
Global Network Japan Network
Highlights for Other B2B Businesses
03
Growth rate sluggish due to factors including the COVID-19 pandemic.
Highlights for Other B2B Businesses: FORCAS MRR
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Mar 2020Mar 2019
● MRR refers to Monthly Recurring Revenue and excludes any one-off transactions such as initial costs.
83
June 2018 Sep 2018 Dec 2018 June 2019 Sep 2019 Dec 2019
・
Mar 2018 Jun 2020
Unit: JPY MM
Total net sales across all Other B2B Businesses significantly increased.
Highlights for Other B2B Businesses: Net Sales
25● Internal transactions between segments are included.
+84%YoY Change
128
361
665
INITIAL
FORCAS
Unit: JPY MM
1H 2018 1H 2019 1H 2020
-122
-53
11
Profitability achieved for the entire segment on a 2Q cumulative basis.
Highlights for Other B2B Businesses: EBITDA
26● All EBITDA figures shown are calculated according to the revised cost allocation system.
YoY Change
+65 MM
Unit: JPY MM
1H 2018 1H 2019 1H 2020
Highlights for NewsPicks
04
MRR surged along with the substantial increase in paid subscriptions.
Highlights for NewsPicks: MRR
28
June 2020June 2015 June 2019
● MRR refers to Monthly Recurring Revenue and excludes any one-off transactions such as initial costs.
Unit: JPY MM
・
June 2016 June 2017 June 2018
229
724
61
102
150・
・
・
・
・
In addition to the paid subscription business, the advertising business also recorded growth despite COVID-19.
Highlights for NewsPicks: Net Sales
29● “Other Income” mainly includes video production and external sales of content.● Internal transactions between segments are included.
1,252
1,894
2,516
Other Businesses
Paid Subscriptions
Advertising
+33%YoY Change
Unit: JPY MM
1H 2018 1H 2019 1H 2020
Profit decreased compared to last year due to concentrated investments in marketing for the favourable paid subscription business, as well as the new NewsPicks NewSchool business.
Highlights for NewsPicks: EBITDA
30● All EBITDA figures shown are calculated according to the revised cost allocation system.
YoY Change
EBITDA
-10
133
82
EBITDA Margin-0.8%
7.1%
3.3%
-51 MM
Unit: JPY MM
1H 2018 1H 2019 1H 2020
Highlights for Quartz
05
USD146K(JPY 15 MM)
Paid subscriptions accelerated in Q2 amid the COVID-19 pandemic, with favorable growth in MRR, and ARR at around JPY 200 million.
Highlights for Quartz: MRR
32
Mar 2020Jun 2019
● MRR refers to Monthly Recurring Revenue and excludes any one-off transactions such as initial fees.● Conversion rate of USD 1 = JPY 108.30 (January-June 2020) used.
Sep 2019 Dec 2019Mar 2019Dec 2018 Jun 2020
USD11.6MM
JPY
1,276MM
JPY
544MM
USD5.0MM
Advertising
JPY
1,312MM
USD11.9MM
Favorable growth seen in paid subscription business, but advertising sales continued to decrease year-on-year in Q2 due to the impact of COVID-19.
Highlights for Quartz: Net Sales
33● Conversion rate of USD 1 = JPY 108.30 (January-June 2020) used for 2Q 2020 (Cumulative) figures.● Advertising business includes other revenue such as grants and syndication.
YoY Change
1H 2018 1H 2019 1H 2020
-732JPY MM
Paid Subscriptions
● Data for 2Q 2018 (Cumulative) includes business results prior to the acquisition, which are unaudited.
USD-13.0MM
USD-11.2MM
JPY
-1,433MM
JPY
-1,216MM
JPY
-984MM
USD-9.0MM
Despite a significant year-on-year decrease in revenue, loss shrank due to cost structure reforms undertaken since 2019. The cost saving effects of the restructuring in May this year will be reflected fully starting in Q3 and profitability is expected to improve further
Highlights for Quartz: EBITDA
34● Conversion rate of USD 1 = JPY 108.30 (January-June 2020) used for 2Q 2020 (Cumulative) figures. ● Data for 2Q 2018 (Cumulative) includes business results prior to the acquisition, which are unaudited.
YoY Change
1H 2018 1H 2019 1H 2020
+216JPY MM
● All EBITDA figures shown are calculated according to the revised cost allocation system.
Appendix
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Appendix: EBITDA for 2018 Onwards Following Revision of Cost Allocation System
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(Unit: JPY MM)
(Unit: JPY MM)
● Table contains corrections to erroneous figures for 4Q 2018 (New System) used in previous materials.● Figures for 2Q, 3Q, and 4Q are cumulative, denoted as “(C.)” . 1Q figures are for that quarter only.
● Under the previous system up to 4Q 2019, costs pertaining to the US business were excluded from the segment figures, but these are now allocated to each segment, resulting in some discrepancies in total EBITDA.
New System2018 2019 2020
1Q 2Q (C.) 3Q (C.) 4Q (C.) 1Q 2Q (C.) 3Q (C.) 4Q (C.) 1Q 2Q (C.)
SPEEDA 234 468 682 1,033 416 826 1,224 1,597 513 1,049
Other B2B -47 -122 -165 -194 -22 -53 -92 -144 5 11
NewsPicks 57 -10 77 202 179 133 86 282 121 82
Quartz - - -327 146 -752 -1,433 -2,044 -2,160 -682 -1,216
Previous System2018 2019 2020年
1Q 2Q (C.) 3Q (C.) 4Q (C.) 1Q 2Q (C.) 3Q (C.) 4Q (C.) 1Q 2Q (C.)
SPEEDA 210 408 566 845 376 739 1,096 1,386 - -
Other B2B -53 -126 -169 -193 -22 -47 -81 -127 - -
NewsPicks 87 53 172 303 197 171 144 389 - -
Quartz - - -301 232 -730 -1,389 -1,986 -2,052 - -
Appendix: Consolidated Profit and Loss Sheet
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Consolidated Profit and Loss Sheet (Actuals)
37
(Unit: JPY MM) 2Q 2018(C.) 2Q 2019(C.) 2Q 2020(C.)
Net Sales 3,068 5,665 6,354
Net Sales Growth Rate 51% 85% 12%
SPEEDA 1,694 2,142 2,638
Other B2B 124 360 660
NewsPicks 1,249 1,885 2,511
Quartz - 1,276 544
EBITDA 324 -528 -104
EBITDA Margin 11% - -
Operating Profit 292 -931 -551
Operating Profit Margin 10% - -
Ordinary Profit 204 -1,007 -665
Ordinary Profit Margin 7% - -
Quarterly Net Profit Attributable to Parent Company Shareholders 67 -965 -1,110
Quarterly Net Profit Margin Attributable to Parent Company Shareholders 2% - -
● Internal transactions between segments are excluded.
Appendix: Consolidated Balance Sheet
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Consolidated Balance Sheet Comparison
2Q 2020 Financial Results
(Unit: JPY MM) End-2019 End-2Q 2020 Change
Current Assets 10,224 9,639 -585
(Cash and Deposits) 7,954 7,983 29
Fixed Assets 10,733 11,444 710
Total Assets 20,958 21,083 125
Current Liabilities 5,131 6,216 1,085
Fixed Liabilities 8,695 7,831 -863
Total Liabilities 13,826 14,048 221
(Interest-Bearing Liabilities) 9,879 9,443 -436
Total Net Assets 7,131 7,035 -96
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For more information on financial records, refer to the full “FY12/2020 2Q Financial Report (Consolidated)”
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13 August 2020
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DisclaimerThe purpose of this material is to provide information to investors, and not to solicit investment in any particular service.
The information disclosed in this material and projections for future performance are based on the data and information available at the time when this material was composed, and may contain uncertainties.
Please be aware that actual future performance and results may differ significantly from projections due to various factors.